Homework SoursePaul Corp acquired 100 percent of Sam Incs voting stock on J
Paul Corp. acquired 100 percent of Sam Inc.\'s voting stock on July 1, 20X1. The following information was available as of December 31, 20X1:
A) $370,000
B) 720,000
C) $940,000
D) $1,090,000
| Net Income | Net Income | |
| Jan 1 – June 30, 20X1 | July 1, 20X1 – Dec 31, 20X1 | |
| Paul Corp. | $300,000 | $420,000 |
| Sam Inc. | $150,000 | $220,000 |
Solution
As Paul Acquired 100% of Sam Inc
The entire net income from the date of acquisition is Parul’s
Net income of Parul for the year is
= Whole year parul net income + Sam Inc net income from the date of acquitsition
=$300,000+$420,000+$220,000
=$940,000
